Browsing: Fiscal consolidation

• The IMF has issued Uganda $120 million as part of its Extended Credit Facility (ECF) Arrangement to aid recovery.
• Total disbursement to Uganda under the ECF Arrangement now reaches $870 million.
• IMF urges Uganda to give its Central Bank independence 

Kampala is set to receive $120 million as part of its Extended Credit Facility (ECF) Arrangement with the International Monetary Fund (IMF) to aid Uganda’s economic recovery amidst various challenges, including backlash due to a harsh anti-LGBTQ law.

The IMF executive board has approved immediate disbursement of the said amount after the conclusion of its fifth review of Uganda’s ECF Arrangement. “This brings the aggregate disbursement under the ECF Arrangement to about $870 million,” the IMF note says in part.

Uganda qualified for about $1 billion under the ECF Arrangement as of June 2021, which is now distributed in part every other year.

IMF loan to aid Uganda’s economic recovery

• Kenya’s debt distress has escalated, with loan repayments falling due amid a depreciating shilling against the dollar.
• Other impediments include Kenya’s vulnerability to climate shocks such as drought and floods, which may derail growth over the long term.
• On the expenditure side, fiscal consolidation in the past two years has led to a real per capita spending decline.

Experts have warned that Kenya risks missing its economic growth targets in the medium term as it grapples with high debt distress and a deteriorating macroeconomic operating environment.

The country finds itself in a tight spot following years of successive borrowing, coupled with the inability of the private sector to create sufficient jobs for millions of young people entering the job market annually.

The latest finding by an economic think tank, the Institute of Public Finance (IPF), shows that since 2014, persistent high fiscal deficits have resulted in a swift escalation of …